B.A.T. Guerrilla Trading System

[expiated]

Friday | April 29, 2022 | 9:35 AM PST

As all of my investigating over the last four or five years winds down, it looks like I will be using Nadex Knock-outs as my primary financial instrument of choice, followed by Nadex Binary Option contracts, despite the fact that I hate the Nadex platform, or at least the binary-option strike price/risk-to-reward structure it has.

Due to the fact that I will be using a methodology most closely matched to guerrilla trading, I am returning to this thread to note a few things that I have already noted in my archive...

First or all, at this point, even the 20-minute trend is being conceptualized as a belt rather than a line. The next fastest measure being monitored is the five-minute trend rather than 8 or 8½, but nothing lower/faster than this. Six hours is useful for helping to anticipate the extremes of daily price action (rather than the 24-hour price range, which is so slow as to almost never be relevant/come into play), and the three- and four-hour measures have since fallen by the wayside.

 

[expiated]

Monday | May 2, 2022 | 4:00 PM PST

So, in the final analysis, I have devised three basic trade setups I will be using in applying the Bias Overlap version of Numerical Price Prediction. Other than stating that they involve the 5-, 15-, 20- and 45-minute price range envelopes, they shall remain in the domain of my personal intellectual property. (The six-hour measure is not really a factor here.)

Things will probably continue to become more detailed and nuanced from here on out. For example, to everything else I will add that when one observes price-action taking place primarily beyond the upper or lower band of the 45-minute price range envelope at 0.10% deviation, there is probably a good chance that there exists fundamental factors supporting a massive amount of momentum behind the trend.

Another indication the a currency pair is trending strongly and market participants should therefore be able to act with confidence is if the lower-panel histogram representing the slope of the 45-minute baseline climbs above 0.09 or crawls below -0.09. Once again, this suggests that there exists fundamental factors supporting a massive amount of momentum behind the trend.

What those factors might be is beside the point from the standpoint of relying on "market driven data." The main thing is simply recognizing the signs that one is looking at a well-supported trend, and then acting accordingly.

Everything about the Cable/Yen has turned bullish. So, let's see if these ten in-the-money binary option contracts pay out in four hours...

 

[expiated]

Tuesday | May 3, 2022 | 6:30 PM PST

The difference between me and your average investor is that s/he will typically put on a trade and then check back periodically to see whether it is making or losing money; whereas the way the "Bias Overlap" style of trading operates involves not only predicting what the market is most likely to do in the near future, but to also monitor price action minute-by-minute, diagnosing what is happening in real time and then adjusting positions if what was forecast turns out to be inconsistent with what is actually unfolding, so that one hardly ever loses money.

So then, the Bias Overlap version of Numerical Price Prediction (NPP) is a guerrilla trading style of buying and selling foreign currency pairs online.

It evaluates the relationships/synergy between such factors as temporal, statistical and horizontal support/resistance levels; typical price ranges; reoccurring chart patterns; market structure; and definitive trend lines--all in multiple time frames--with the key trends at the intraday (i.e., day trading) level consisting of the 5-, 15-, 20- and 45-minute baselines.

Traders may enter positions SOLELY under specific sets of conditions, of which there exits only three or four, depending on how one looks at it. Accordingly, I am providing myself with a graphic aid that will allow me to quickly assess all the currency pairs on my watch list at a glance to determine if any present ideal situations for some type of action.

 

[expiated]

These were Scenario #1 sell signals, as described in your private notes. They would have both returned at least 20-pip's worth of profit. They occurred at approximately 7:30 AM and 10:30 AM Pacific Standard Time.

These were Scenario #2 buy and sell signals...

They were triggered at about 7:30 PM and 10:00 PM Pacific Standard Time last night, and then again at about 5:00 AM Pacific Standard Time this morning.

Be careful of Scenario #3, which is much more frequent, but can often turn out to be the beginning of a fully-fledged reversal rather than a mere pullback.

As for Scenario #4, which is related to the 15-minute price range envelope, allow it to remain somewhat flexible for the time being, given the fact that at this point, no concrete protocols have emerged "organically" with respect to this measure.

 

[expiated]

Tuesday | May 3, 2022 | 2:00 PM PST

I'm going to start distinguishing between what I will be calling "Artificial Trend Lines" and "Valid Trend Lines."

These lines can have the exact same lower-panel reading (i.e., slope), but in the case of the former, the measure means little because its angle is the result of a price anomaly (a spike or plunge in the exchange rate) so that the direction of price action is actually statistically likely to be the opposite of the course on which the moving average is headed (as in the above two examples).

Obviously, I don't want to make trade decisions on the basis of Artificial Trend Lines, so I was thinking about how to define them, and in glancing at the above image, I think it might be possible to do so by noting the maximum amount of price range deviation that typically characterizes Valid Trend Lines. Let's see what that might be...

Hmmm... for the 15-minute baseline it looks to be approximately 0.20% deviation. So, as long as price remains within this parameter, if the pair is trending, I'm likely to want to stay with it. Beyond this however, I need to watch closely for any signs that the asset is actually initiating movement in the opposite direction.

I wanted to see what was the maximum amount of price range deviation that typically characterizes the 45-minute baseline. But, in checking, I don't think it matters. I'm thinking that this because when it comes to the Bias Overlap style of trading, the 15-minute trend is king, with the 6-minute baseline dictating when to enter and exit positions.

In other words, the 45-minute trend is irrelevant. It is too slow/lagging to be of any practical value. It's primary value is as a "landmark" suggesting where price reversals are, statistically speaking, becoming more likely to occur; and as graphical aid reflecting the gist of overall price flow at the intraday level. But then, this has already been communicated when stating that the measure is now being depicted as a "belt," as a range of values, rather than as a moving average.

 

[expiated]

You keep forgetting what B.A.T. was supposed to stand for, so let's just note right here that it was supposed to be an abbreviation for "biblical approach to trading."

 

[expiated]

Wednesday | May 4, 2022 | 8:20 PM PST
Anecdotal Observations:

Now that the 15-minute trend has emerged as king, you can probably eliminate the 20-minute measure from your charts and simply go with 5, 15 and 45 minutes. This would mean that the 15-minute price range envelope now constitutes the NEW “Eureka” Price Range Envelope.

Most recently, the lowest measure utilized by the Bias Overlap version of Numerical Price Prediction was the five-minute price range envelope. However, as I continue to evaluate price action through the eyes of this strategy, I am prompted to introduce the use of a 2½-minute baseline, along with the instantaneous moving averages (at the one-minute level) which provides absolute clarity with respect to short-term trend reversals, and might prove quite valuable if and when trading via the Pocket Option platform.

This change has led to a number of additional potential trade setups, each of which will need to be evaluated and ranked in terms of how well they work in real time (if at all) and quantified regarding their respective success rates.

The following trade was just executed successfully based on the eureka price range envelope setup...

 

[expiated]

So, having begun formal operations with my partner in India (on a trial basis) I am finding that, though he suggested he spends almost as much time trading as I do, in actuality, he spends almost no time trading (on his own) at all. Consequently, I doubt we will continue to collaborate after this week. But, for the time being at least, most of my thoughts are being shared via a private platform between the two of us. Nonetheless, there ARE a couple of things I want to note where I am more likely to run across them again, hence the following entry...

Having begun official operations as a practitioner of Numerical Price Projection (NPP), here is what (I think) are my ultimate views:

I used to debate whether the 20-, 30- or 40-minute baseline should be the primary arbiter of my decisions at the day trading level, but in fact, it is none of those. Rather, it is the 13-minute baseline.

The other three measures mentioned above ARE important however, but as PRICE RANGE ENVELOPES and NOT as baselines. Together, they convey the gist of where price is headed at the intraday level, or the directional tendency of price action, if you will.

Moreover, these channels, at the proper deviation levels, constitute the levels at which the "immediate" trend will, more often than not, elect to reverse direction. By immediate trend I am referring to the five-minute to 15-minute flow of price.

These reversals are best conveyed on a five-minute chart using the six-minute baseline and the ten-minute dynamic price range envelope, with the first indicator "riding" the upper band of the second when the immediate trend is bullish, or riding the lower band when the immediate trend is bearish.

(When the trend is neutral, the six-minute baseline will embark on a more-or-less sideways, or horizontal course between the two bands.)

Even so, one should probably be looking to enter short positions ONLY when when the 13-minute baseline is sloping downward, long positions ONLY when the 13-minute baseline is sloping upwards, and to remain on the sidelines when the 13-minute baseline is neutral. Also, the best time to enter positions is when the slope of the 13-minute baseline matches the slope of the three consensus price range envelopes mentioned above.

 

[expiated]

In participating in the challenge phase of Tradiacs "funded" trader program, after about two or three weeks I find myself wishing to up my typical stake to either a half or full Lot, and for that I need to return to the hands-on day trading style I started with six years ago.

So, here are the particulars as they now stand (for my own records)...

1. Always trade in the direction of the four-minute price flow, but ONLY when it is in agreement with the slope of the 20-minute baseline (and perhaps when the baseline is, at the very least, neutral).
2. Use that "backside" of the 8½-minute price flow envelope at 0.04% deviation as your entry levels.
3. Set your take-profit targets at the "thrust side" of the 8½-minute price flow envelope at 0.04% deviation, but move your targets accordingly if price begins to run. (Do not allow your trades to exit a given position until and unless the four-minute trend is reversing direction.)
4. The most ideal scenario is when the four-minute and 20-minute measures are ALSO aligned with the slope of the 34- to 36-minute price range envelope at 0.06% deviation.
5. So then, your key levels in terms of launch pads and landing sites are: (A) the upper and lower bands of the 8½-minute price flow envelope at 0.04% deviation; (B) the upper and lower bands of the 34- to 36-minute price range envelope at 0.06% deviation; and (C) the floor and ceiling of the 60- to 70-minute temporal support/resistance channel.
6. (There is also a significantly increased statistical probability of price reversing direction at the 0.20% deviation level(s) of the two-hour price range envelope.)

 

[expiated]

Use that "backside" of the 8½-minute price flow envelope at 0.04% deviation as your entry levels.

Especially if the "slope" of the lower-panel 20-minute baseline histogram is greater or less than 0.0135 or -0.0135 respectively and/or the "slope" of the lower-panel 36-minute baseline histogram is greater or less than 0.007778 or -0.007778 respectively.